The conventional wisdom when selling a home has always been to wait until the ‘Spring Buying Season’. Over the years, that has seemed to make sense and is now accepted as a good strategy for those who want to sell their house and receive the best possible price. This real estate market has shattered many previously held beliefs. The wisdom of waiting for a sprng market is another belief that is about to fall.
Here are five reasons why:
1. Interest Rates are On The Rise
Interest rates have spiked up rather dramatically over the last ninety days and are now over 5%. Initially an incrase in rates has a positive effect on the market as it forces buyers off the fence. However, it also eats into a buyer’s purchasing power. As rates increase, the mortgage amount of a buyer qualifies for decreases. This will eventuallly have a negative impact on prices .
2. Your Dream Home Will Never Be Cheaper
If your family goal is to sell your current house and take advantage of the fabulous selection of properties currently available to buy the home of your dreams, DO IT NOW! Prices will continue to soften in most markets. However, if you are buying, COST should be more important than PRICE. Cost can be dramatically impacted by rising mortgage interest rates. Do the math and decide if now is the time.
3. Buyers are Out Early
There is mounting evidence that buyers are coming out earlier this year. A belief that now is a good time to buy coupled with the increase in interest rates has started the buying season early.
Pete Flint, CEO of Trulia:
“We’re seeing a national resurgence of buyer and seller activity on Trulia.com. In January alone, we experienced an unprecedented level of site traffic including 11 million unique visitors – which is more than 70 percent year-over-year growth. We’ve are now experiencing 100,000 property views per minute.”
The National Association of Realtors just reported that the number of house sales increased 12.9% over the last month.
4. Inventory Increases Every Spring
Every year there is an increase of inventory which comes to market as we approach the spring. Here is the number of listinngs available for sale in 2010.
- February – 3,531,000
- March – 3,626,000
- April – 4,029,000
We believe there will be an increase in these numbers in 2011 as there is a pent-up selling demand created by the weak market of the last few years. You won’t have to worry about this increasing competition of you sell now.
5. We are in The Eye of the Foreclosure Storm
While banks are trying to recify their foreclosure procedures, there is a large supply of discounted properties which has been delayed coming to makret. This inventory will be released sometime in the next few months. Foreclosures sell on average at a 41% discount. When released they will be competing with your hosue for the buyers in the marketplace. If you are looking to sell in 2011, you want to sell before this inventory becomes your competition.
CNN Money quoted the leadership of RealtyTrac on this issue:
“We’ve now seen three straight months with fewer than 300,000 properties receiving foreclosure filings, following 20 straight months where the total exceeded 300,000” said James Saccacio, CEO of RealtyTrac.
“Unfortunately,” he added, “This is less a sign of a robust housing recovery and more a sign that lenders have become bogged down in reviewing procedures, resubmitting paperwork and formulating legal arguments related to accusations of improper foreclosure processing.”
“We expect a spike in the first quarter,” said Rick Sharga, a RealtyTrac spokesman.
BOTTOM LINE
These are five strong reasons to sell now instead of waiting until later in the year.
Article by M Emerson from First Team News
If you have been watching real estate news over the past few years it has been difficult, at best, to figure out what to make out of the reporting. As we always say – real estate is local – and becuase of that much of what is reported should be taken with a grain of salt. In Southern California we have the luxury of living in one of the most desirable markets in the world and the market trends and local activity are what it is all about. Let’s see what our friends at Keeping Current Matters have to say about news you will hear in 2011…
Like Comparing Apples to Oranges
Over the next several months, there is going to be some confusion about how well the real estate market is doing. Some headlines are going to announce several consecutive months of increased sales. Other headlines are going to talk about a near total collapse in housing. Both headlines will be based on facts supplied by the National Association of Realtors (NAR). How can that be? How can data report that two opposite things are happening at the same time?
Let us explain. NAR will release two reports each month: the Pending Sales Report and the Existing Sales Report.
The Pending Sales Report (as per NAR)
The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.
The Existing Sales Report (as per NAR)
Existing-home sales are completed transactions that include single-family, townhomes, condominiums and co-ops.
The reason there will be confusion created by the media reports is actually simple to explain. There will be two different numbers reported by both reports each month.
- The month-over-month (M-O-M) comparison and
- The year-over-year (Y-O-Y) comparison
Normally, we would want to look at the Y-O-Y numbers in each report. However, these numbers are skewed because of the Home Buyer Tax Credit which was available to purchasers for the first four months of last year. Comparing contracts and sales with this time last year would be like comparing apples and oranges.
We strongly suggest that you look at the momentum shown in the month-over-month numbers. They accurately depict a surge in sales that we believe will continue throughout 2011. However, that does not mean price appreciation. Just as demand is increasing so is the supply of inventory. Price is determined by both supply and demand. We do not see any price appreciation until later in the year or early next year.
Bottom Line
The market is coming back. Homes are selling. We have turned the corner and 2011 will be the year the market will normalize.
Article from First Team News by M Emerson
A substantial majority of both home owners and current renters agree that owning a home is a smart decision over the long term. That’s according to the results of a National Association of Realtors® survey of 3,793 adults conducted online by Harris Interactive.
The American Attitudes About Homeownership survey found that in today’s challenging economy, 95 percent of owners and 72 percent of renters believe that over a period of several years, it makes more sense to own a home. In addition, an overwhelming majority of home owners are happy with their decision to own a home – 93 percent of owners surveyed would buy again.
“Home owners and renters agree that home ownership benefits individuals and families, strengthens our communities, and is integral to our nation’s economy,” said National Association of Realtors® President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “The results of this survey illustrate just how important issues related to home ownership are to people in this country.”
The survey uncovered some differences between home owners and renters, as well. While more than half of owners are “very” or “extremely” satisfied with the overall quality of their family life, only one-third of renters report the same levels of satisfaction. Similarly, 43 percent of home owners are very/extremely satisfied with their community life, compared with 30 percent of renters.
A majority of renters – 63 percent – said that it was at least somewhat likely that they would purchase a home at some point in the future. Among this group, young adults (18-29 years old) have the strongest aspirations for home ownership; only 8 percent of young adults said that it was “not at all likely” that they would purchase a home at some point in the future.
In today’s market, many aspiring home owners are faced with worries about job security and creditworthiness. Among renters who are very or extremely likely to buy a home in the future, three out of five consider confidence in job security and creditworthiness to be an obstacle.
One point of agreement between renters and home owners was support of the mortgage interest deduction (MID). Seventy-four percent of owners and 62 percent of renters say it’s “extremely” or “very” important that the MID remain in place.
“At a time when the middle class is under increasing economic pressures, both home owners and renters agree that the mortgage interest deduction should not be targeted for change,” said Phipps. “Given strong public support of and aspirations toward owning a home, we need to keep policies in place that support and encourage responsible, sustainable home ownership for our future.”
This survey was conducted online within the U.S. and fielded October 6-20, 2010. A total of 3,793 adults, 18 and older were surveyed, including 1,880 home owners, 1,115 renters, and 798 young adults. All samples came from the Harris Poll online database and were weighted for age, sex, race/ethnicity, education, region and household income to be representative of the U.S. general population of adults 18 and older. Propensity score weighting was also used to adjust for respondents’ propensity to be online. Results are available online at www.realtor.org/statsanddata/homeownership/attitudes_homeown.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
Article from Realtor.org by Stephanie Singer
Instantly get a FREE Listingbook account from Renee Hartanto.
